UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
) REAR ADM. (RET) JAMES J. CAREY ) et al., ) ) Plaintiffs, ) ) v. ) Civil Action No. 11-259 (RMC) ) FEDERAL ELECTION COMMISSION, ) ) Defendant. ) )
MEMORANDUM OPINION ON MOTION FOR PRELIMINARY INJUNCTION
Plaintiffs Rear Adm. (Ret.) James J. Carey and the National Defense Political Action
Committee (“NDPAC”) seek to solicit and expend contributions for: (1) independent expenditures
in federal election campaigns; and (2) direct funding of federal candidates, a candidate’s political
committee, or political party committees. They seek to solicit unlimited funds for use in independent
expenditure campaigns, while maintaining statutory limits on solicitation of funds for direct funding
of federal candidates. Plaintiffs propose to keep these two distinct pools of funds segregated by
maintaining separate banking accounts. Plaintiff Kelly S. Eustis is a private citizen who would like
to contribute toward NDPAC’s independent expenditure campaigns in an amount currently
exceeding the statutory maximum of $5,000.
Plaintiffs seek a preliminary injunction to enjoin the Federal Election Commission
(“FEC” or “Commission”) from enforcing 2 U.S.C. §§ 441a(a)(1)(C) & 441a(a)(3) against NDPAC
for its planned solicitation and acceptance of unlimited contributions (including Plaintiff Eustis’) for
use in making independent expenditures in federal election campaigning; Plaintiffs do not challenge
-1- the Commission’s power to enforce the amount and source limits with respect to solicitation and use
of contributions directly for federal candidates and party committees. The Commission opposes the
motion, failing to appreciate the applicability of Citizens United v. FEC, 130 S. Ct. 876 (2010),
EMILY’s List v. FEC, 581 F.3d 1 (D.C. Cir. 2009), and SpeechNow.org v. FEC, 599 F.3d 686 (D.C.
Cir. 2010), which govern the result in this case. A limited preliminary injunction will be granted.
I. FEDERAL ELECTION CAMPAIGN LAW
The Federal Election Campaign Act (“FECA”), 2 U.S.C. §§ 431 et seq., inter alia,
imposes limits on the sources and amounts of contributions that may be made by individuals and
groups to federal candidates, party committees, and political action committees. Key to assessing
these limits is the identity of the receiver of those contributions and the purpose for which those
contributions are expended.
Under FECA, a contribution is “any gift, subscription, loan, advance, or deposit of
money or anything of value made by any person for the purpose of influencing any election for
Federal office; or the payment by any person of compensation for the personal services of another
person which are rendered to a political committee without charge for any purpose.” 2 U.S.C.
§ 431(8). A contribution, however, can be used in several ways, and depending on that purpose it
can legally be limited to certain amounts.
If contributions are directed toward a federal candidate’s personal coffers or his or
her own political action committee, such contributions are subject to statutory limits because of the
“strong governmental interest in combating corruption and the appearance thereof.” EMILY’s List,
581 F.3d at 8. The same can be said of contributions to political party committees because of the
“close relationship between candidates and parties.” Id. at 9. Section 441a(a)(1)(C) provides that
-2- no person shall make contributions “to any other political committee . . . in any calendar year which,
in the aggregate, exceed $5,000.” 2 U.S.C. § 441a(a)(1)(C). Section 441a(a)(3) provides:
During the period which begins on January 1 of an odd-numbered year and ends on December 31 of the next even-numbered year, no individual may make contributions aggregating more than – (A) $37,500, in the case of contributions to candidates and the authorized committees of candidates; (B) $57.500, in the case of any other contributions, of which not more than $37,500 may be attributable to political committees which are not political committees of national political parties.
2 U.S.C. § 441a(a)(3). All contributions and expenditures made subject to these source and amount
limitations are referred to as “hard money.” See EMILY’s List, 581 F.3d at 27.
Under §§ 441a(a)(1)(C) & 441a(a)(3) there is no distinction made between political
committees directly associated with parties/federal candidates and non-connected political action
committees.1 And no distinction need be made if the non-connected political action committee is
merely funneling its contributions, as a “conduit,” to federal candidates, their personal political
action committees or political party committees. See EMILY’s List, 581 F.3d at 24–26. Generally
speaking, “[u]nder FECA, a political committee is ‘any committee, club, association, or other group
of persons’ that receives contributions of more than $1000 in a year or makes expenditures of more
than $1000 in a year.” SpeechNow.org v. FEC, 599 F.3d at 691 (citing 2 U.S.C. § 431(4)). “Once
a group is so designated, contributions to the committee are restricted by 2 U.S.C. § 441a(a)(1)(C)
and 441a(a)(3).” Id.
If, however, a non-connected political action committee is making independent
1 “‘Non-connected’ means that the [political action committee] is not a candidate committee, a party committee, or a committee established by a corporation or labor union.” EMILY’s List, 581 F.3d at 15 n.7.
-3- expenditures,2 wholly separate from federal candidates or parties, the analysis is different because
there is not that same governmental interest in protecting quid pro quo corruption. See EMILY’s
List, 581 F.3d at 9–11. Recent Supreme Court and D.C. Circuit cases have partially invalidated
statutory provisions within FECA with respect to the limits placed on contributions for independent
expenditures in federal election campaigns. See Citizens United v. FEC, 130 S.Ct. 876 (2010);
SpeechNow.org v. FEC, 599 F.3d 686 (D.C. Cir. 2010); EMILY’s List v. FEC, 581 F.3d 1 (D.C. Cir.
2009).
These cases have clarified the constitutional scope of monetary limits on contributions
for the purpose of independent expenditures. Contributions and expenditures are not limited for this
purpose and may be made from a “general treasury account that is not subject to source and amount
limits,” otherwise known as “soft money.” See EMILY’s List, 581 F.3d at 27. These cases have
found that limits on soft money contributions used for independent expenditures are unconstitutional
because such a limitation violates a contributor’s First Amendment rights, while also finding that
hard money limits on expenditures that directly support federal candidates, their authorized
committees, or any political committee established and maintained by a national political party are
constitutional. See generally Citizens United v. FEC, 130 S.Ct. 876 (2010); SpeechNow.org v. FEC,
599 F.3d 686 (D.C. Cir. 2010); EMILY’s List v. FEC, 581 F.3d 1 (D.C. Cir. 2009).
2 Independent expenditures are “expenditure[s] by a person--(A) expressly advocating the election or defeat of a clearly identified candidate; and (B) that [are] not made in concert or cooperation with or at the request or suggestion of such candidate, the candidate’s authorized political committee, or their agents, or a political party committee or its agents.” 2 U.S.C. § 431(17).
-4- II. FACTS
Admiral Carey is the founder and treasurer of NDPAC, a political action committee
registered with the Commission. Verified Compl. ¶¶ 8 & 10. NDPAC “advocates in favor of limited
government, upholding a national commitment to this nation’s veterans, and publicly defends the
rights of American soldiers,” by “rais[ing] and expend[ing] funds in support of candidates for federal
office who are military veterans and agree with its values.” Id. ¶ 12. NDPAC raises funds pursuant
to the amount and source limitations detailed within 2 U.S.C. § 441a and “makes contributions to
candidates for federal office up to the applicable limit and makes independent expenditures in
support or opposition of candidates.” Id. ¶ 12. Plaintiff Kelly S. Eustis is a potential contributor to
NDPAC who would like to contribute more than the amount currently allowed toward NDPAC’s
independent expenditures in federal campaigns. Id. ¶ 13.
Plaintiffs complain that §§ 441a(a)(1)(C) & 441a(a)(3) impose unconstitutional limits
on amounts an individual may contribute to a non-connected political committee such as NDPAC
with respect to independent expenditures. Citing Citizens United, EMILY’s List, and
SpeechNow.org, Plaintiffs dispute the constitutionality of any limit when those contributions are
used for independent federal expenditures. V. Compl. ¶ 13. Plaintiffs do not contest the
Commission’s authority to regulate “hard money” under § 441a(a)(1)(A) and (B), which limits
contributions to candidates, a candidate’s authorized committee, and any political committee
established and maintained by a national political party. See V. Compl. ¶ 49.
NDPAC requested an advisory opinion from the Commission on August 11, 2010,
pursuant to 2 U.S.C. § 437f, asking whether it would be lawful for NDPAC to accept unlimited
contributions for the purpose of making independent expenditures. V. Compl. ¶ 15. NDPAC
-5- committed to the limits on contributions made directly to federal candidates; it proposed to separate
those “campaign contribution” funds from “independent expenditure” funds by maintaining two
separate bank accounts. Id. The Commission’s general counsel prepared two alternative draft
advisory opinions for the Commission’s consideration, one of which held NDPAC to the disputed
statutory limits under §§ 441a(a)(1)(C) & 441a(a)(3) (“Draft A”), and the other of which held that
separate independent expenditures, when wholly separated from hard money contributions, are not
subject to contribution limits (“Draft B”). Id. ¶¶ 17–18. On September 23, 2010, the six-member
Commission failed to issue a binding four-vote advisory opinion, missing approval of Draft A by
a vote of 2-3 and missing approval of Draft B by a vote of 3-2. Id. ¶¶ 19–20. Commissioner
Walther did not vote on either draft. Id., Attach. 1 at 33. As a result, the Commission left NDPAC
and Admiral Carey liable for possible enforcement actions against them should NDPAC solicit more
than applicable limits currently allowed under §§ 441a(a)(1)(C) & 441a(a)(3) for independent
expenditures. Likewise, Mr. Eustis could be liable for a possible enforcement action should he
contribute to NDPAC more than the amount currently allowed.
On January 31, 2011, Plaintiffs filed a complaint and motion for preliminary
injunction, seeking to enjoin the Commission from enforcing §§ 441a(a)(1)(C) & 441a(a)(3) against
Plaintiffs should NDPAC and Admiral Carey solicit and receive contributions in excess of those
statutory limits and/or should Mr. Eustis contribute more than currently allowed.
III. LEGAL STANDARDS
A district court may grant a preliminary injunction “to preserve the relative positions
of the parties until a trial on the merits can be held.” Univ. Of Tex. v. Camenisch, 451 U.S. 390, 395
(1981). An injunction is an equitable remedy so its issuance is one which falls within the sound
-6- discretion of the district court. See Hecht Co. v. Bowles, 321 U.S. 321, 329 (1944). A plaintiff
seeking a preliminary injunction must establish that:
(a) he is likely to succeed on the merits;
(b) that he is likely to suffer irreparable harm in the absence of preliminary relief;
(c) that the balance of equities tips in his favor; and
(d) that an injunction is in the public interest.
Winter v. NRDC, Inc., 555 U.S. 7, 129 S. Ct. 365, 374 (2008). The D.C. Circuit has further
instructed that “the movant has the burden to show that all four factors . . . weigh in favor of the
injunction.” Davis v. Pension Benefit Guar. Corp., 571 F.3d 1288, 1292 (D.C. Cir. 2009).
In the past, courts have balanced the four factors on a “sliding scale,” i.e., a lesser
showing on one factor could be surmounted by a greater showing on another factor. CSX Transp.,
Inc. v. Williams, 406 F.3d 667 (D.C. Cir. 2005). Winter v. NRDC called this approach into question:
“[i]ssuing a preliminary injunction based only on a possibility of irreparable harm [despite finding
a strong likelihood of success on the merits] is inconsistent with our characterization of injunctive
relief as an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff
is entitled to such relief.” Winter, 129 U.S. at 375-76. The D.C. Circuit has interpreted Winter to
require a positive showing on all four preliminary injunction factors. Davis, 571 F.3d at 1292; see
also Sherley v. Sebelius, Case No 10-5287, 2011 U.S. App. LEXIS 8686 at *10–11 (D.C. Cir. Apr.
29, 2011). In sum, a preliminary injunction is “an extraordinary remedy that should be granted only
when the party seeking the relief, by a clear showing, carries the burden of persuasion.” Cobell v.
Norton, 391 F.3d 251, 258 (D.C. Cir. 2004).
-7- IV. LEGAL ANALYSIS
A. Probability of Success on the Merits
Plaintiffs’ probability of success on the merits is the most critical of the criteria when
considering a motion for a preliminary injunction. See Greater New Orleans Fair Housing Action
Center, et al. v. HUD, No. 10-5257, 2011 U.S. App. LEXIS 7138 at *13 (D.C. Cir. Apr. 18, 2011)
(“In ruling on a preliminary injunction a key issue—often the dispositive one—is whether the
movant has shown a substantial likelihood of success on the merits.”) (citing Munaf v. Geren, 553
U.S. 674, 690 (2008)). The Court finds that Plaintiffs have a high likelihood of partial success.
“Laws that burden political speech are ‘subject to strict scrutiny,’ which requires the Government
to prove that the restriction ‘furthers a compelling interest and is narrowly tailored to achieve that
interest.’” See Citizens United, 130 S. Ct. at 898. Here, the Government does not succeed in
meeting this high burden.
This Court is instructed and bound by the decisions of the Supreme Court and the
D.C. Circuit Court of Appeals. The Commission attempts to limit the scope of the Circuit’s recent
decision in EMILY’s List without success. The Circuit’s ruling was not limited to the authority of
the Commission to issue regulations, as the Commission would posit, but included binding precedent
on the constitutional rights of non-connected political committees, which the Commission
unpersuasively argues is dicta.3
3 See FEC’s Opp’n to Pls.’ Mot. for a Preliminary Injunction (“Opp’n”) [Dkt. # 11] at 22 (“Alternatively, to the extent that EMILY’s List’s statements regarding ‘hard-money’ and ‘soft- money’ accounts can be interpreted to apply outside the context of mixed federal and non-federal spending to conduct like plaintiffs’ proposed expenditures that are entirely federal, that limited portion of the majority opinion should be treated as dicta. The suggestion that separate accounts are the constitutionally required solution for addressing possible corruption in the context of a non-profit’s federal independent expenditures was not necessary to the decision regarding
-8- EMILY’s List cited critical teachings from Supreme Court precedent:
First, the Court has held that campaign contributions and expenditures constitute “speech” within the protection of the First Amendment. ....
Second, the Court has ruled that Government cannot limit campaign contributions and expenditures to achieve “equalization” – that is, it cannot restrict the speech of some so that others might have equal voice or influence in the electoral process.4 In perhaps the most important sentence in the Court’s entire campaign finance jurisprudence, Buckley [v. Valeo, 424 U.S. 1, 48-49 (1976)] stated: ‘[T]he concept that government may restrict the speech of some elements of our society in order to enhance the relative voice of others is wholly foreign to the First Amendment.’ ....
Third, the Court has recognized a strong governmental interest in combating corruption and the appearance thereof . . . . This anticorruption interest is implicated by contributions to candidates . ... ....
Fourth, in applying the anti-corruption rationale,5 the Court has afforded stronger protection to expenditures by citizens and groups . . . than it has provided to their contributions to candidates or parties.6
whether to strike down Commission regulations for allocation of federal and non-federal spending.”). Even if the Circuit’s discussion of First Amendment rights were dicta, which it was not, EMILY’s List would still be persuasive authority. 4 See also SpeechNow.org, 599 F.3d at 692 (“Equalization of differing viewpoints is not a legitimate government objective.”) 5 See also SpeechNow.org, 599 F.3d at 693 (noting that Citizens United held that the government has no anti-corruption interest in limiting independent expenditures); Citizens United, 130 S. Ct. at 909 (“[W]e now conclude that independent expenditures, including those made by corporations, do not give rise to corruption or the appearance of corruption.”). 6 See also SpeechNow.org, 599 F.3d at 692 (“In Buckley v. Valeo, 424 U.S. 1 (1976), the Supreme Court held that, although contribution limits do encroach upon First Amendment
-9- ....
Fifth, the Court has been somewhat more tolerant of regulation of for-profit corporations and labor unions.7 ....
To sum up so far: In reconciling the competing interests, the Supreme Court has generally approved statutory limits on contributions to candidates and political parties as consistent with the First Amendment. The Court has rejected expenditure limits on individuals, groups, candidates, and parties, even though expenditures may confer benefits on candidates.
EMILY’s List, 581 F.3d at 5-8 (footnotes added).
These principals do not wholly address this case, in which NDPAC wants to make
both independent expenditures for federal campaigns with “soft money” and direct contributions to
federal candidates and political parties with “hard money.” However, from the Circuit’s description,
NDPAC and EMILY’s List are identical in that regard: “EMILY’s List is a good example of such
a hybrid non-profit: It makes expenditures for advertisements, get-out-the-vote efforts, and voter
registration drives; it also makes direct contributions to candidates and parties.” EMILY’s List, 581
F.3d at 12. “The constitutional principles that govern such a hybrid non-profit entity follow
ineluctably from the well-established principles governing the other two categories of non-profits.”
interests, they do not encroach upon First Amendment interests to as great a degree as expenditure limits.”) 7 At the time of EMILY’s List, as the Circuit noted, Citizens United was pending before the Supreme Court and the limitation on corporate and union expenditures was under review. EMILY’s List, 581 F.3d at 8 n.6. Citizens United overruled Austin v. Mich. Chamber of Commerce, 494 U.S. 652, 902, 905 (1990), “refus[ing] to find a sufficiently compelling governmental interest in preventing the ‘corrosive and distorting effects of immense aggregations of wealth that are accumulated with the help of the corporate form.’” SpeechNow.org, 599 F.3d at 692 (quoting Austin v. Mich., 494 U.S. at 660).
-10- Id.8
To prevent circumvention of contribution limits by individual donors, non- profit entities may be required to make their own contributions to federal candidates and parties out of a hard-money account – that is, an account subject to source and amount limitations ($5000 annually per contributor). Similarly, non-profits also may be compelled to use their hard-money accounts to pay an appropriately tailored share of administrative expenses associated with their contributions. But non-profit entities are entitled to make their expenditures – such as advertisements, get-out-the-vote efforts, and registration drives – out of a soft-money or general treasury account that is not subject to source and amount limits. Stated another way: A non- profit that makes expenditures to support federal candidates does not suddenly forfeit its First Amendment rights when it decides also to make direct contributions to parties or candidates. Rather, it simply must ensure, to avoid circumvention of individual contribution limits by its donors, that its contributions to parties or candidates come from a hard-money account.
Id. (citation omitted); see also SpeechNow.org, 599 F.3d at 695 (“Limits on direct contributions to
candidates, ‘unlike limits on independent expenditures, have been an accepted means to prevent quid
pro quo corruption.’”) (quoting Citizens United, 130 S. Ct. at 909).
Instead of approving NDPAC’s proposal of separate accounts for hard-money and
soft-money contributions and expenditures, the Commission would require NDPAC to establish a
second formal committee, with its own adherence to existing statutory limits. But EMILY’s List does
not require such a resolution. Nor does the Commission’s demand further its stated “compelling
interest,” see Citizens United, 130 S. Ct. at 898 (requiring compelling interest), of anti-corruption;
the Commission fails to recognize that non-connected non-profits are not the same as political parties
and do not cause the same concerns of quid pro quo money-for-access. See EMILY’s List, 581 F.3d
8 The Commission frames EMILY’s List as merely a controversy about allocation regulations concerning payment of administrative expenses. Not so. The Circuit quite expansively addressed First Amendment principles and applied those principles to Emily’s List and its various activities.
-11- at 18 (“Donations to and spending by a non-profit cannot corrupt a candidate or officeholder, at least
in the absence of some McConnell-like9 evidence establishing such corruption or the appearance
thereof.”); id. at 22 (“The concurrence cites no similar record evidence showing that non-profits sell
access to officeholders and candidates in exchange for large soft-money contributions.”); id. (“In our
judgment, ‘McConnell views political parties as different in kind than independent expenditure
committees.’ N.C. Right to Life v. Leake, 525 F.3d 274, 293 (4th Cir. 2008)”). Further, even if some
compelling interest were identified, the Commission’s proposal is not narrowly tailored to achieve
that objective. See Citizens United, 130 S. Ct. at 898 (requiring narrowly tailored means to achieve
a compelling interest). The Commission’s proposal fails to explain adequately why Plaintiffs’
proposed separation of accounts does not satisfy the same objective as separate policitcal action
committees in a less burdensome manner. Plaintiffs’ proposal conforms with the two basic tenets
that govern non-connected non-profits’ election campaign contributions: (1) “non-profit groups may
accept unlimited donations to their soft-money accounts [a]nd . . . may spend unlimited amounts out
of their soft-money accounts for election-related activities such as advertisements, get-out-the-vote
efforts, and voter registration drives,” see EMILY’s List, 581 F.3d at 14; and (2) “non-profit entities
may be required to use their hard-money accounts for their own contributions to candidates and
parties and for an appropriately tailored share of administrative expenses associated with such
contributions.” Id. at 16.
NDPAC’s proposal would comply fully with EMILY’s List by establishing separate
accounts to (1) solicit and spend unlimited funds for independent federal expenditures (soft money);
and (2) solicit and spend statutorily-limited expenses on direct contributions to federal political
9 McConnell v. FEC, 540 U.S. 93 (2003).
-12- candidates and/or political parties (hard money). NDPAC’s approach is squarely approved by
EMILY’s List, leading to the inevitable conclusion that NDPAC has a strong possibility of success
on the merits.10 Further, maintaining two separate accounts is a perfectly legitimate and narrowly-
tailored means to ensure no cross-over between soft and hard money, as opposed to the
Commission’s overly burdensome alternative. See Citizens United, 130 S. Ct. at 898 (requiring
narrowly tailored means to achieve compelling interest).
Plaintiffs’ strong possibility of success is limited by the requirement that NDPAC
separate its hard and soft money accounts and comply with the applicable “hard money” limits on
contributions going directly to federal candidates, their campaigns, and national parties. For this
reason, § 441a(1)(C), which deals specifically with contributions to political committees such as
NDPAC, and not directly to federal candidates, is clearly free of any contribution limits when the
contributions are used for independent federal expenditures. Section 443a(3), however, is a broader
provision and Plaintiffs’ arguments do not support an injunction against it in its entirety. Certainly,
§ 441a(3)(A), which limits individual contributions “to candidates and the authorized committees
of candidates,” has a recognized anti-corruption goal and its enforcement by the Commission does
not offend Plaintiffs’ First Amendment rights. Such contributions raise legitimate anti-corruption
concerns, not presented by independent federal expenditures. Subsection (B) of § 441a(3) fails to
10 The Commission’s efforts to write away the Circuit’s constitutional analysis as dicta, Opp’n at 22, is plain wrong. Judge Brown, in a limited concurrence, said that it was unnecessary for the Circuit to address the constitutional issues since the case could be resolved on statutory bases alone. See EMILY’s List, 581 F.3d at 25 (Brown, J., concurring). The majority “respectfully but firmly disagree[d]” because “EMILY’s List raises a statutory challenge to only three of the five provisions at issue here” and the remaining two could only be addressed by constitutional analysis. Id. at 24. Therefore, the Circuit had “no choice but to address EMILY’s List’s First Amendment argument.” Id.
-13- distinguish between contributions to unconnected political action committees conducting
independent expenditure activities, and contributions to unconnected political action committees for
direct contributions to candidates, candidate political committees, and national parties. The former
must be permitted without limitation; the latter remains subject to the limitations of the statute.
Therefore, Plaintiffs’ motion for an injunction against enforcement of
§§ 441a(a)(1)(C) & 441a(a)(3) is likely to succeed, insofar as any contributions to NDPAC used for
the purpose of subsequent contributions to candidates, candidates’ committees, or national parties
remain subject to statutory contribution limits, NDPAC maintains separate bank accounts for its
“hard money” and “soft money,” and NDPAC proportionally pays related administrative costs from
those accounts.
B. Irreparable Harm
“The First Amendment does not permit laws that force speakers to retain a campaign
finance attorney, conduct demographic marketing research, or seek declaratory rulings before
discussing the most salient political issues of our day.” Citizens United, 130 S. Ct. at 889. But that
is what has happened here: because the Commissioners could not agree, the Commission staff has
been forced into a crabbed reading of EMILY’s List and erroneous proposals to avoid recognizing
Plaintiffs’ First Amendment rights.
The fact that Plaintiffs may have another outlet to exercise their First Amendment
rights to free speech–such as the establishment of a separate committee or PAC, as suggested by the
Commission in its opposition–does not answer this constitutional challenge. While the Commission
might expound on such alternatives, they do nothing to cure the constitutional maladies of its heavy-
handed approach. “The fundamental flaw” to the Commission’s approach continues to be that it
-14- “improperly ‘[brings] to bear what was essentially a political party analysis to a non-connected,
independent committee which is not under the control of, or associated with candidates in the fashion
of a political party.’” EMILY’s List, 581 F.3d at 15 (citation omitted). Stifling citizens’ speech rights
during a Presidential campaign runs contrary to the entire history of First Amendment jurisprudence
in this country. See Citizens United, 130 S.Ct. at 892 (“political speech . . . is central to the meaning
and purpose of the First Amendment”).
The President of the United States announced his formal bid for re-election in April
2011, a full nineteen months before the November 2012 election. The race is on right now.
Whichever candidates Plaintiffs wish to support and issues they wish to espouse must be freed
immediately from the chill of possible FEC enforcement. “First Amendment rights are arguably
chilled, as long as there is a credible threat of prosecution.” Chamber of Commerce of U.S. v. FEC,
69 F.3d 600, 603-04 (D.C. Cir. 1995). Although the Commission suggests that it will probably not
enforce its rules, nothing “prevents the Commission from enforcing its rule at any time” and the
inability of the Commissioners to vote affirmatively on an advisory opinion presages that
possibility.11
11 The Commission properly points out that the issue in Chamber of Commerce of U.S. was the plaintiff’s standing to challenge an FEC rule, not imminent danger of such enforcement. The Commission also concedes, however, “[t]o be sure, a new Commissioner or a change of mind by a current Commissioner could lead to an enforcement action against NDPAC . . . .” Opp’n at 35–36 n.10. The imminence of Plaintiffs’ harm here is the onset of the presidential campaign and the muting of their voice that the Commission’s position would impose, despite clear Circuit law to the contrary. Notably, when the Commission was considering Plaintiffs’ request for an Advisory Opinion, “it appeared that any potential enforcement action against NDPAC would be brought outside this Circuit, in the Northern District of Virginia, where NDPAC resides and is incorporated” and where EMILY’s List is not binding. Opp’n at 23 n.7. Without an injunction, such enforcement might still proceed in Virginia. To this end, the Court notes the discussion of the Commission’s enforcement in Citizens United and the need to avoid its entanglements:
-15- In just such an instance, First Amendment case law recognizes that pre-enforcement
challenges are entirely permissible, if not welcome. As noted above, political speech is at the very
core of the First Amendment. Buckley, 424 U.S. at 39. The right to speak effectively would be
“diluted if it does not include the right to pool money through contributions, for funds are often
essential if ‘advocacy’ is to be truly or optimally ‘effective.’” Citizens Against Rent Control v. City
of Berkeley, 454 U.S. 290, 296 (1981) (quoting Buckley, 424 U.S. at 65-66). If the President, the
leader of a national political party with deep coffers, believes it is not too late to begin his
[The FEC] regulatory scheme may not be a prior restraint on speech in the strict sense of that term, for prospective speakers are not compelled by law to seek an advisory opinion from the FEC before the speech takes place. As a practical matter, however . . . , a speaker who wants to avoid threats of criminal liability and the heavy costs of defending against FEC enforcement must ask a governmental agency for prior permission to speak. These onerous restrictions thus function as the equivalent of prior restraint by giving the FEC power analogous to licensing laws implemented in 16th- and 17th-century England, laws and governmental practices of the sort the First Amendment was drawn to prohibit. . . .
[FEC v. Wisconsin Right to Life, Inc., 551 U.S. 449 (2007)] said that First Amendment standards “must eschew ‘the open-ended rough-and- tumble of factors,’ which ‘invit[es] complex argument in a trial court and a virtually inevitable appeal.’” Yet, the FEC has created a regime that allows it to select what political speech is safe for public consumption by applying ambiguous tests. If parties want to avoid litigation and the possibility of civil and criminal penalties, they must either refrain from speaking or ask the FEC to issue an advisory opinion approving of the political speech in question. Government officials pore over each word of a text to see if, in their judgment, it accords with the 11-factor test they have promulgated. This is an unprecedented governmental intervention into the realm of speech.
Citizens United, 130 S. Ct. at 895-96 (citations omitted). Of course, these Plaintiffs attempted to obtain an advisory opinion, only to have the Commissioners refuse.
-16- fundraising and campaigning for 2012, it cannot be too soon for these Plaintiffs to participate in the
national discourse, whatever their views; and precluding their speech while this litigation wound to
its expected conclusion would impose irreparable harm to their First Amendment rights. The “First
Amendment requires [courts] to err on the side of protecting political speech rather than suppressing
it.” FEC v. Wisconsin Right to Life, 551 U.S. at 457. “Speech is an essential mechanism of
democracy, for it is the means to hold officials accountable to the people . . . . The First Amendment
has its fullest and most urgent application to speech uttered during a campaign for political office.”
Citizens United, 130 S. Ct. at 898 (citations and quotations omitted).
The Court finds that the political season for the presidential election is already
underway and the time to participate is now; that Plaintiffs swear by Verified Complaint they wish
to participate in that national discourse in multiple ways; that the precedents of this Circuit and the
Supreme Court fully support Plaintiffs’ position as to both direct candidate contributions and
independent expenditures; and that the possibility of Commission enforcement of its contrary
position cannot be ignored. Plaintiffs show that the Commission’s interference with their First
Amendment rights constitutes irreparable harm.
C. Balance of Harms
Plaintiffs have established concrete plans to engage in a focused independent
expenditure campaign as soon as they are legally permitted to do so. The Verified Complaint
indicates that “as soon as possible” NDPAC would like to engage in an independent expenditure
campaign directed against Anthony Weiner in New York’s Ninth Congressional District, by the
expenditure of approximately $6,300 (to be contributed by Mr. Eustis) to run a series of
advertisements on Newsmax, an internet website. V. Compl. ¶ 24. They must refrain from doing
-17- so now because the Commissioners failed to issue a requested Advisory Opinion, which means
Plaintiffs face the possibility of civil or criminal liability if they proceed without official government
approval.
The Commission responds that Plaintiffs’ alleged injuries are neither actual nor
certain because they could fund the planned $6,300 advertisement expenditure in at least “four
obvious ways:”
• Combine a $5,000 contribution from Mr. Eustis with $1,300 from NDPAC’s existing funds; • Accept $5,000 from Mr. Eustis and combine it with $1,300 from another donor or combination of donors; • Set up a separate entity that accepts contributions of unlimited amounts; • Have Mr. Eustis simply pay for the planned ad himself.
Opp’n at 32. Each of these proposals, however, would require Plaintiffs to forego their First
Amendment rights that are guaranteed by the Constitution and recognized by this Circuit. The
Commission’s questioning of Plaintiffs’ intentions – noting that NDPAC “has never before in its 11-
year history run independent expenditure advertising that in the aggregate exceeded $200 in a
calendar year,” Opp’n at 33 – is immaterial in the face of Plaintiffs’ Verified Complaint. The Court
does not assess the credibility of Plaintiffs’ sworn allegations, and the Commission’s efforts to
diminish Plaintiffs’ injury by questioning their bona fides does not well serve the agency or its
argument.
According to the Verified Complaint, NDPAC will maintain separate accounts to (1)
collect and expend monies for contributions to federal candidates and party committees; and (2)
solicit and expend monies for independent federal expenditure activities. See V. Compl. ¶ 59
(“National Defense PAC’s contributions to candidates, party committees or the hard money accounts
-18- of other PACs will be made from a separate account comprised of funds received from individuals
in amounts of $5000 or less. National Defense PAC will pay the expense of administering its
contributions to candidates from the same account. Independent expenditures will be made from a
separate account.”)
The Commission argues that separate accounts for committees that engage in both
“hard-money” and “soft-money” expenditure activities is insufficient to address corruption and the
appearance of corruption. Opp’n at 25–26; 37 (“Permitting plaintiffs to fund independent
expenditures through an existing political committee that also makes contributions to candidates
would undermine the anti-corruption purpose and disclosure requirements in the Act.”). This
argument cannot overcome direct Supreme Court and Circuit precedent. See Citizens United, 130
S. Ct. at 909 (“[W]e now conclude that independent expenditures, including those made by
corporations, do not give rise to corruption or the appearance of corruption.”); SpeechNow.org, 599
F.3d at 693 (noting that Citizens United “held that the government has no anti-corruption interest in
limiting independent expenditures.”).12 Moreover, EMILY’s List specifically addressed a hybrid non-
profit entity that both made independent expenditures and contributed directly to federal candidates,
campaigns, and parties – and found no problem. See EMILY’s List, 581 F.3d at 12.
Plaintiffs seek preliminary and permanent injunctions enjoining the Commission from
12 See also Citizens United, 130 S. Ct. at 913:
Austin is overruled, so it provides no basis for allowing the Government to limit corporate independent expenditures. . . . Section 441b’s restrictions on corporate independent expenditures are therefore invalid . . . .”
Id. The Commission makes no argument that would distinguish Plaintiffs’ independent expenditures from those now allowed by corporations under Citizens United.
-19- enforcing §§ 441a(a)(1)(C) & 441a(a)(3) against them with respect only to independent expenditures.
Plaintiffs do not contest the Commission’s authority to regulate “hard money.” See V. Compl. ¶ 49.
Such a request is fully consistent with the analyses of Citizens United, Buckley, SpeechNow.org and
EMILY’s List, and the Commission can offer no viable public harm to the contrary. As long as
Plaintiffs strictly segregate these funds and maintain the statutory limits on soliciting and spending
hard money, they are free to seek and expend unlimited soft money funds geared toward independent
expenditures. Because neither contribution nor expenditure limitations involving independent
expenditure activities are constitutional under the First Amendment, the Commission cannot prevail
and the harm falls entirely on Plaintiffs.
D. Public Interest
“Speech is an essential mechanism of democracy, for it is the means to hold officials
accountable to the people . . . . The First Amendment has its fullest and most urgent application to
speech uttered during a campaign for political office.” Citizens United, 130 S. Ct. at 898 (citations
and quotations omitted). The public interest is supported by protecting the right to speak, both
individually and collectively. Here, to protect Plaintiffs’ right to engage in political speech through
independent expenditure campaigning is fully in accord with the public’s interest in free speech and
association.
V. CONCLUSION
Having weighed the factors required to be considered in determining whether to
preliminarily enjoin the Commission from enforcing §§ 441a(a)(1)(C) & 441a(a)(3), the Court grants
a preliminary injunction as follows: The Commission shall not enforce 2 U.S.C. §§ 441a(a)(1)(C)
& 441a(a)(3) against Plaintiffs with regard to independent expenditures, as long as the NDPAC
-20- maintains separate bank accounts for its “hard money” and “soft money,” proportionally pays related
administrative costs, and complies with the applicable monetary limits of “hard money”
contributions. All “soft money” contributions used toward federal independent expenditure
campaigns shall be free of any contribution limits. A memorializing Order accompanies this
Memorandum Opinion.
Date: June 14, 2011 /s/ ROSEMARY M. COLLYER United States District Judge
-21-